How Debt Relief Grants from the Government Work

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Tuesday, March 10th, 2009 Subscribe To Our Feed

Despite the fantastic claims you may have seen in certain ads, the government does not in fact offer grants to people to pay off their debts. government grants for debt relief are not one of the many sources of funding available. A lot of the companies offering ways to legally get out of debt are really offering bankruptcy services. Bankruptcies are handled by the government, but debt grants are not. {The government may not offer grants to pay off debts, but they do handle bankruptcy matters.}

While not technically debt relief grants from the government, there are programs for people who need help with student loans or are facing foreclosure. These programs usually have very strict guidelines. Also confused for government debt relief grant is the government’s ability to forgive federal loans.

Although the government does not advocate bankruptcy, it recognizes that the only option for some people is to declare bankruptcy and start all over again. Debt relief grants from the government will not give you the chance you need to start over, only bankruptcy can do that.

How Bankruptcy Has Changed

Realizing that increasing numbers of individuals were abusing bankruptcy laws as an easy way to get out of their debts, the government has created new rules to ensure that creditors do not end up being forced to pay for the misdeeds of irresponsible spenders. For example, anyone being considered for bankruptcy must go through credit counseling first. Once again, the companies youíve seen offering help with debt relief grants from the government are probably offering bankruptcy services.

You are not limited to filing Chapter 7 bankruptcy for debt relief from the governmetn. According to Chapter 13 bankruptcy rules, the debtor is required to pay off his debts on a regular basis and within a stipulated time. That is if you can afford the payment amount a court trustee assigns.

Although both Chapter 7 and Chapter 13 bankruptcy might be misconstrued as debt relief grants from the government, in actuality, individuals who file for Chapter 7 may have to surrender any property they own, to be liquidated for debt repayment. If you go with Chapter 13, you get to keep your property as long as you make the court appointment payments.

We often recommend hiring a debt settlement professional to people who come seeking our advice. For those with little time or energy to devote to cleaning up their debt this can be a great idea. An even better idea (and quick way out of debt) is to do it yourself. If you’re interested in that you must check out Charles Phelan. With this one guide I’ve seen amazing results with my clients!

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